Abu Dhabi’s Second-Biggest Bank Said to Weigh Selling Bad Loans

Abu Dhabi Commercial Bank PJSC is considering potentially offloading more bad debt, people familiar with the matter said, as Middle East lenders look to further clean up their balance sheets, Bloomberg reported.

Abu Dhabi’s second-largest lender could look to sell a package of non-performing loans as soon as the end of 2025, the people said, declining to be identified as the information is private. The bank is in the early stages of studying such a deal, the people said.

ADCB first sold distressed debt in 2023, twin deals that were seen as landmarks for the region. It offloaded a $1.1 billion loan book to US hedge fund Davidson Kempner Capital Management LP, as well as $357 million of debt to a recovery fund led by professional services firm Grant Thornton.

The bank hasn’t made final decisions on the timing or size of the latest sale, though people familiar with the matter said it could be similar in magnitude to the Grant Thornton deal.

A spokesperson for ADCB declined to comment.

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The lender recently received an upgrade from S&P Global Ratings, which said “strategic balance-sheet derisking over the past four years has strengthened its resilience to economic cycles and unexpected stresses.”